Walstra: Operational Management in the service sector
Chapter 1: Defining the scope
1.1 Operations management
Employees of an organization that operate and interact with guests form part of the operations
function. The operations function is the systematically organized body of resources dedicated to the
creation and delivery of goods and services. Operations function and other function within the
organization are known as management functions. Examples of functions:
- Employees in the park itself
- Marketing department
- Finance department
- HR department
- Facilities department
If all the functions in an organization work in conjunction, additional revenue can be generated.
All employees in the park have something in common: they all work for the guests, regardless of
whether guests interact with them or not.
Knowing what the customer values and ensuring the service you offer matches the way the
customer wants to be treated is the biggest challenge for service providers in this day and age.
1.2 What is the service sector?
Characteristics of services:
- Intangible and cannot be stored
- Activities or a series of activities
- Produced and consumed simultaneously
- The customer forms part of the production of services
This foundation influences operations in a number of ways:
- You cannot store services, so there is a greater risk of capacity constraint. It is also
impossible to get things done ahead of time (if a cinema is only half occupied for the
evening, you can’t sell the unused seats the next day).
- The customer is present during the production process, so you have to take into account
your customer’s wishes, capabilities and common sense.
- There is always interaction with the customer during the process of service production
- The success of the operations function often relies upon the cooperation of the client.
1.3 What is included in the service sector?
Important notes:
Media industry is also a service. They provide experiences but supplied from a distance. During the
provision of a media service there is no personal interaction between the service provider and the
consumer.
1.4 From strategy to operations: every link counts
The service process should always be in line with the businesses’ short and long-term goals.
1.4.1 Operations and strategy
The foundation of the strategic lies in having a clear goal that everyone agrees on and that each
member of staff can help obtain within their own position. Mission statement a statement that
describes the goal that an organization is trying to achieve through their goods and services.
There is a strong relationship between the operations and the strategy of a business. The strategy
describes how a business plans to achieve its mission statement and the operations forms the
tangible translation of this to the customer.
, 1.4.2 Operations and marketing
Knowing the market is of utmost importance. Knowledge about the market can be obtained by
performing research through formal market research such as by a marketing agency, or informal
market research in the form of customer interaction.
It is also important to influence the market simultaneously, through publicity and other forms of
promotion.
1.4.3 Operations and facilities management
When servicing customers, the operations team must be able to trust the important hardware and
software of the business. Hardware refers to the facilities in which the service is offered. On one
hand in terms of construction (building, painting, etc.) and on the other hand in terms of daily
cleanliness.
1.5 Why operations management?
Besides setting up the best possible framework for the operations department, the operations
manager will also want to see continuous improvement. Customers also want to see this. A very
common method for improving includes comparing your own operations with those of others, a
process that is known as benchmarking. This can be done in a number of ways, such as comparing
key figures or conducting customer satisfaction surveys. The foundation for benchmarking is learning
form other businesses.
Chapter 2: Operations in the service sector: the position of the customer
The customer will be seen as both a user and co-producer of the service. Every time the customer
and service provider interact with each other, is known as a touchpoint, and influences the
customer’s experience also known as moment of truth.
2.1 The relationship between customer and operations
During the customer journey, the customer mainly experiences the results of the human resources
and marketing functions. These are the two management functions that are the most important
partners for operations. To ensure that the connection between the customer experience and the
business offering actually works, the marketing department devises personas.
2.2 The customer influence
Mapping the customer journey is of the greatest importance to design a successful service
organization.
Christopher Lovelock (2007) has drawn up a classification of services (common features). In a
combination of classifications, a service may fulfill one or more features.
- The nature of the service
- The method of delivery
- The role of capacity
One more classification added by Walstra: the context in which these services are provided.
Chapter 1: Defining the scope
1.1 Operations management
Employees of an organization that operate and interact with guests form part of the operations
function. The operations function is the systematically organized body of resources dedicated to the
creation and delivery of goods and services. Operations function and other function within the
organization are known as management functions. Examples of functions:
- Employees in the park itself
- Marketing department
- Finance department
- HR department
- Facilities department
If all the functions in an organization work in conjunction, additional revenue can be generated.
All employees in the park have something in common: they all work for the guests, regardless of
whether guests interact with them or not.
Knowing what the customer values and ensuring the service you offer matches the way the
customer wants to be treated is the biggest challenge for service providers in this day and age.
1.2 What is the service sector?
Characteristics of services:
- Intangible and cannot be stored
- Activities or a series of activities
- Produced and consumed simultaneously
- The customer forms part of the production of services
This foundation influences operations in a number of ways:
- You cannot store services, so there is a greater risk of capacity constraint. It is also
impossible to get things done ahead of time (if a cinema is only half occupied for the
evening, you can’t sell the unused seats the next day).
- The customer is present during the production process, so you have to take into account
your customer’s wishes, capabilities and common sense.
- There is always interaction with the customer during the process of service production
- The success of the operations function often relies upon the cooperation of the client.
1.3 What is included in the service sector?
Important notes:
Media industry is also a service. They provide experiences but supplied from a distance. During the
provision of a media service there is no personal interaction between the service provider and the
consumer.
1.4 From strategy to operations: every link counts
The service process should always be in line with the businesses’ short and long-term goals.
1.4.1 Operations and strategy
The foundation of the strategic lies in having a clear goal that everyone agrees on and that each
member of staff can help obtain within their own position. Mission statement a statement that
describes the goal that an organization is trying to achieve through their goods and services.
There is a strong relationship between the operations and the strategy of a business. The strategy
describes how a business plans to achieve its mission statement and the operations forms the
tangible translation of this to the customer.
, 1.4.2 Operations and marketing
Knowing the market is of utmost importance. Knowledge about the market can be obtained by
performing research through formal market research such as by a marketing agency, or informal
market research in the form of customer interaction.
It is also important to influence the market simultaneously, through publicity and other forms of
promotion.
1.4.3 Operations and facilities management
When servicing customers, the operations team must be able to trust the important hardware and
software of the business. Hardware refers to the facilities in which the service is offered. On one
hand in terms of construction (building, painting, etc.) and on the other hand in terms of daily
cleanliness.
1.5 Why operations management?
Besides setting up the best possible framework for the operations department, the operations
manager will also want to see continuous improvement. Customers also want to see this. A very
common method for improving includes comparing your own operations with those of others, a
process that is known as benchmarking. This can be done in a number of ways, such as comparing
key figures or conducting customer satisfaction surveys. The foundation for benchmarking is learning
form other businesses.
Chapter 2: Operations in the service sector: the position of the customer
The customer will be seen as both a user and co-producer of the service. Every time the customer
and service provider interact with each other, is known as a touchpoint, and influences the
customer’s experience also known as moment of truth.
2.1 The relationship between customer and operations
During the customer journey, the customer mainly experiences the results of the human resources
and marketing functions. These are the two management functions that are the most important
partners for operations. To ensure that the connection between the customer experience and the
business offering actually works, the marketing department devises personas.
2.2 The customer influence
Mapping the customer journey is of the greatest importance to design a successful service
organization.
Christopher Lovelock (2007) has drawn up a classification of services (common features). In a
combination of classifications, a service may fulfill one or more features.
- The nature of the service
- The method of delivery
- The role of capacity
One more classification added by Walstra: the context in which these services are provided.
